Credit card rates are going up, even as other lending rates fall. (Shutterstock)

(Newser)
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Interest rates are tumbling for US Treasuries, companies, and home-buyers. The prime rate is extremely low. Yet for some reason, credit card companies are charging more and more, with average rates hitting a nine-year high of 14.7% in the second quarter, the Wall Street Journalreports. Companies say they’re reacting to new regulations that prevent them from charging penalty fees and raising rates without warning customers.

The increases come seemingly without regard for the prime rate, which is supposed to be the cards’ benchmark. Right now, card rates are 11.45 percentage points higher than the prime rate, the biggest disparity in 22 years. “The rules have changed, and the goalposts have changed,” said the head of Citigroup’s card unit, blaming regulators for the hike. But the law's backers are unapologetic. "Better that consumers should know up-front what the interest rate is, even if it's higher," argued co-sponsor Rep. Carolyn Maloney, "than to be soaked by tricks and hidden fees."

Thank you Obama, Reid, Pelosi, Frank and Dodd. Once again you have displayed your ignorance and done a great dis-service to America.

Ucantusethatname

Aug 23, 2010 2:51 PM CDT

Wall Street screws the public one more time.

sirgil

Aug 23, 2010 2:43 PM CDT

The ultimate "Ponzi Schemers" is the Credit Card Industry. Its a undeclared Monopoly, and unregulated global and untouchable. The boards and shareholder change faster than you change your underwear while having diarrhea! They claim high risk and loss, only to hide behind securitizing the debt, on whatever global market exchange they can, and then sell the losses to unscrupulous collectors of debt located inside and outside the US with no clear recourse to sue for violating US Code. As for regulators, they just let it happen and cannot even tell you how credit scores are calculated or models justified for the consumer. CC the only scheme left that is better than loan sharking.